Part 12/15:
Furthermore, there exists a disconnect between "market sentiment" and "economic reality." While stock prices have soared since the lows of mid-2023, macroeconomic data—from consumer sentiment to employment—indicates a weakening economy increasingly slipping into contraction.
Looking Forward: The Flat and Firing Regime
As we look toward 2026, the trend suggests a move from no hiring, no firing to a phase of no hiring, some firing. This gradual transition is enough to raise unemployment and curtail consumer spending, particularly during the holiday season, as evidenced by declining holiday spending plans. Consumers, aware of the job market’s fragility, plan to reduce their purchases, further stalling economic growth.